By JIM KUHNHENN, KIMBERLY HEFLING

updated 10/26/2011 4:34:04 PM ET

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DENVER  — President Barack Obama recalled his struggles with student loan debt as he unveiled a plan Wednesday that could give millions of young people some relief on their payments.

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Speaking at the University of Colorado Denver, Obama said that he and his wife, Michelle, together owed more than $120,000 in law school debt that took nearly a decade to pay off. He said that sometimes he'd have to make monthly payments to multiple lenders, and the debt meant they were not only paying for their own degrees but saving for their daughters' college funds simultaneously.

"I've been in your shoes. We did not come from a wealthy family," Obama said to cheers.

Story: Another idea for student loan debt: Make it go away

Obama said it's never been more important to get a college education, but it's also never been more expensive. Obama said his plan will help not just individuals, but the nation, because graduates will have more money to spend on things like buying homes.

"Our economy needs it right now and your future could use a boost right now," Obama said.

Obama's plan will accelerate a measure passed by Congress that reduces the maximum required payment on student loans from 15 percent of discretionary income annually to 10 percent. He will put it into effect in 2012, instead of 2014. In addition, the White House says the remaining debt would be forgiven after 20 years, instead of 25. About 1.6 million borrowers could be affected.

He will also allow borrowers who have a loan from the Federal Family Education Loan Program and a direct loan from the government to consolidate them into one. The consolidated loan would carry an interest rate of up to a half percentage point less than before. This could affect 5.8 million borrowers.

 Video: Obama outlines student loan relief plan (on this page)

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Student loans are the No. 2 source of household debt. The president's announcement came on the same day as a new report on tuition costsfrom the College Board. It showed that average in-state tuition and fees at four-year public colleges rose $631 this fall, or 8.3 percent, compared with a year ago. Nationally, the cost of a full credit load has passed $8,000, an all-time high.

Student loan debt is a common concern voiced by Occupy Wall Street protesters. Obama's plan could help him shore up re-election support among young voters, an important voting bloc in his 2008 election. But, it might not ease all their fears.

Story: Obama offers mortgage relief on Western trip

Anna Van Pelt, 24, a graduate student in public health at the University of Colorado Denver who attended the speech, estimates she'll graduate with $40,000 in loans. She called Obama's plan a "really big deal" for her, but said she still worries about how she'll make the payments.

"By the time I graduate, my interest rate is going to be astronomical, especially when you don't have a job," Van Pelt said. "So it's not just paying the loans back. It's paying the loans back without a job."

The White House said the changes will carry no additional costs to taxpayers.

Sen. Mike Enzi, R-Wyo., his party's ranking member on the Senate Health, Education, Labor and Pensions Committee, said in a statement that while he supports efforts to help struggling graduates, the president's plan was crafted behind closed doors and "we are left with more questions than answers."

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Last year, Congress passed a law that lowered the repayment cap and moved student loans to direct lending by eliminating banks as the middlemen. Before that, borrowers could get loans directly from the government or from the Federal Family Education Loan Program; the latter were issued by private lenders but basically insured by the government. The law was passed along with the health care overhaul with the anticipation that it could save about $60 billion over a decade.

The change in the law was opposed by many Republicans. At a hearing Tuesday, Rep. Virginia Foxx, R-N.C., who chairs a subcommittee with oversight over higher education, said it had resulted in poorer customer service for borrowers. And Senate Republicans issued a news release with a compilation of headlines that showed thousands of workers in student lending, including those from Sallie Mae Inc., had been laid off because of the change.

Today, there are 23 million borrowers with $490 billion in loans under the Federal Family Education Loan Program. Last year, the Education Department made $102.2 billion in direct loans to 11.5 million recipients.

Final Rubric and Analysis

Story Impact on Audience

·         Being current college students, we are the ones who are taking out student loans.

·         Over 2/3 of college students currently have student loans taken out.

·         In 2011 our country surpassed 1 trillion dollars in student loans debt

New angle on Student loans

·         I believe that state funding for public schooling needs to be increased in order to fix our student loan crisis. The government needs to set up programs instructing students to take out loans in a more responsible and reasonable manner. The state needs to generate a greater amount of scholarships for high school seniors.

Content

·         To inform ISU students on the commitment they are making when taking out student loans. They should be knowledgeable on the current situation our government is in.

·         To list and express possible options to improve the student loan system in our country.

Interview

·         Employees at financial aid office

·         Students in library/Bone center

Analysis

·         All my articles begin with important facts that grab the reader’s attention, winth statistics pertaining to the current problem in the system

·         The middle of the articles consisted of mostly personal opinions or thoughts on the current system in place for student loans, and possible options to improve it.

·         The ending of the articles consisted of a personal statement that relates the article with you, and a statistic that usually is quite shocking.

·         All used professional style language, in an article format, consisted of paragraphs to separate speech. Some contained video to go along with the article.

·          

                                                                                                                                                        

Half Way Through Blog

In regard to the unit I believe that I am just finally getting the hang of it. At first I had trouble with all the online work we were doing with the blog. I wasn’t familiar with blogs, and had a lot of trouble figuring out the whole network and how to work it. I believe that I am finally getting the hang of it. This class so far has brought so much new material to my attention, not only the course material but like I said previously the use of technology and other helpful skills. I have learned how to analyze articles, and determine if they are an informal article. I also have participated in groups and brainstormed openly to create one final group result. I have never experienced a writing process the way that we are going about it so far, but I believe that I am going to be much more organized and focused in my writing approach. I am looking forward to the remainder of our learning this semester. And expect to continue my progress in all aspects of English 101.

Denis McAuliffe

English 101

Student Loans Rubric

·         Student loans give lower income students the opportunity to attend college

·         More than 2/3 of college students take out student loans

·         Students loan debt reached 1 trillion dollars in 2011

·         Cost of college tuition continues to increase

·         Delinquent borrowers create poor credit for themselves

·         Lack of programs helping students to better manage loan payments

Denis McAuliffe

English 101

Nicole Osolin

Rubric

Problems with College Tuition

·         Private universities are unaffordable for almost all students

·         Public university tuition continues to increase rapidly

·         Economy continues to suffer and tuition cost continue to increase

·         States schools not getting enough funding from state

·         Student loans are granted very often and loosely

·         Financial Aid given by the state to help assist in paying tuition is not sufficient

·         Student debt is higher than ever, preventing new graduates from being productive citizens and improving America’s economy.

·         Multiple children households struggle to put kids through college, it is not even remotely possible for most.

·         America continues to drive economy to the ground with ridiculous tuition prices

http://www.theolympian.com/2011/11/03/1862264/poor-economy-turning-student-loan.html

Economy turning student-loan problem into a crisis

THE OLYMPIAN • Published November 03, 2011

• 35 COMMENTS

Student-loan debt is on pace to reach $1 trillion in the United States this year and it topped credit-card debt for the first time last year.

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More than two-thirds of all college students borrow money to attend college and up to 20 percent of them have loan payments that exceed 10 percent of their gross income after they leave college and the loans come due.

The student-loan debt crisis is deepening as college graduates face difficulty finding good-paying jobs and the cost of a college education continues to climb, more than 538 percent in the past 30 years.

It hurts students, families and society in general when borrowers become delinquent or default on their loans. The consequences can last a lifetime in terms of poor credit. Despite the dire results, about 41 percent of borrowers who reached the repayment phase of their loan in 2005 defaulted or became delinquent in their payments within five years.

Programs to help students and parents better manage and pay off student loan debt are needed more than ever, especially when the average total parent and student debt for this year’s graduates is estimated at $34,400, more than double what it was less than 10 years ago.

President Barack Obama unveiled a plan last week to provide some relief for students with federal loans. It’s a start, but it provides no help for students with loans from private financial institutions, which make up about 20 percent of the outstanding education loans.

Key provisions of the Obama plan include:

 • A cap on student-loan repayments at 10 percent of a borrower’s discretionary income, beginning in January 2012. This could benefit up to 1.6 million student borrowers with federal loans, reducing payments on average by a couple of hundred dollars per month. If someone is still carrying student-loan debt 20 years after starting a repayment plan, the remainder would be forgiven. That’s five years sooner than current law allows.

It’s important to note that a program has been in place since 2007 to cap federal student-loan repayment at 15 percent of discretionary income for those already in the workplace. Unfortunately, only 450,000 of the nation’s 36 million former students with federal loans are taking advantage of the program.

 • Allowing those with student-loan debt to consolidate their federal loans into one monthly payment that could reduce the interest rate on certain loans by 0.5 percent.

 • Creating a new financial aid disclosure form that colleges and universities would use to compare financial aid packages and better understand the debt burden students will face at graduation.

The costs and risks of student loans need to be known up front, before students and parents sign on the dotted line.

Too often, students and parents receive financial-aid-award letters lacking in such basic information as interest rates and monthly loan payments. Some don’t even use the word “loan,” lulling some into thinking they are applying for a grant.

Another new program forgives federal student loans for borrowers with public service jobs they spend 10 years at, working full time.

For those who think bankruptcy is an option – forget about it. In 2008, student-loan borrowers filing for bankruptcy were successful getting their loans dismissed only 0.04 percent of the time.

The next generation of college students is going to have to be a lot smarter about how much debt they take on to go to school. Some may have to reset their sights on less expensive colleges or spend their first two years at a community college.

High school counselors need to do a better job explaining the pros and cons of college choices and financial aid packages. The stakes are too high for anything other than full financial disclosure.

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Read more here: http://www.theolympian.com/2011/11/03/1862264/poor-economy-turning-student-loan.html#storylink=cpy